A new era for the chemicals industry: Cloud computing changes the game

A new era for the
chemicals industry
Cloud computing changes the game

A new era for the chemicals industry
Cloud computing changes the game
 Multiple drivers for cloud adoption in the chemicals industry
 Cloud computing adoption moves up the stack
 Six ways cloud computing will change the game
 Journey to the cloud
Copyright © 2014 Accenture All rights reserved. 2

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Multiple drivers for cloud adoption in chemicals industry
How cloud computing changes the game
Emerging trends are driving chemicals companies to improve their agility, reduce costs, and boost speed and
responsiveness. These can be achieved through transforming their business into a cloud-enabled digital
business. Key drivers for the shift include:
 Increasing importance of emerging markets that need to be penetrated quickly and cost effectively.
 Increasingly complex and diverse global supply chains, where higher speeds and visibility are required
for responsive collaboration.
 Rise of the green agenda is driving companies to lower energy consumption and emissions and,
comply with environmental norms.
 Rising commoditization has created a demand for differentiation through innovation in products,
processes and business models.
 Growing infrastructure investment, cost and time pressures are forcing companies to create
greater operational and cost agility across the enterprise.
Copyright © 2014 Accenture All rights reserved.

The chemicals industry starts its cloud journey
Cloud computing adoption moves up the stack
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To leverage cloud technology, chemicals companies are overcoming barriers to cloud adoption and
moving up the IT stack.
 Cloud solutions are deemed secure by many governments.
Example: While the Federal Cloud Computing Initiative1 in the United States drives
cloud computing adoption at a federal level, public sector bodies—under UK’s
“cloud first” policy—need to consider cloud solutions before any other option2.
 PaaS solutions help companies build custom differentiations to business processes.
A hybrid model enables companies to leverage their existing IT investments in legacy
systems while reaping benefits from cloud-based solutions.

The chemicals industry starts its cloud journey
Cloud computing adoption moves up the stack
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Cloud adoption is both accelerating and moving up the IT stack.
 Moving up the cloud stack:
• Chemicals companies move to IaaS to reduce costs and use virtualization to create a private cloud architecture.
• The companies use SaaS in customer relationship management (CRM), through offerings such as the
Salesforce.com suite and in procurement through solutions such as Ariba.
• Wide SaaS adoption and growing PaaS uptake will lead to chemicals companies using BPaaS solutions.
• Example: By adopting a cloud-based e-invoicing service3 Dow Chemical was able to meet different national
requirements across 17 European nations through one service provider.
 Cloud computing—combined with complementary and convergent technologies such as mobile,
analytics and social media capabilities, and related elements such as remote
online sensors, biometrics and unmanned drones—provides the hard business
benefits that chemicals companies need to justify investment in cloud technology.

Cloud computing: a primer
Clouds generally take one of a combination of four forms
Private
clouds
 Dedicated hosting
 On-premises (company data
centre or off-premises (3rd party)
 Virtualized infrastructure,
applications and
communications
Hybrid
clouds
 Blend of shared utility hosting and
dedicated hosting
 Retain confidential information
privately while providing access to
the wider choice of public cloud
applications and platforms
Business Processes
Application
Platform
Infrastructure
IaaS
Public
clouds
 Shared utility hosting
 Off premises
 Provided by external 3rd parties
PaaS
SaaS
over a network
BPaaS
Service models
All of these forms of cloud can provide
computing “on demand” at one or more
of these four stack levels
Community
clouds
 Collaborative resources shared between
organizations with common
requirements & interests
 Often in the same industry
 Costs are spread across users

How cloud computing will change the game
Six dynamics
1. Real-time remote, predictive and mobile asset monitoring and maintenance
2. Integrating, sharing and analysis of Big Data
3. Enhanced employee health and safety and remote medical monitoring
4. More efficient, agile and secure IT
5. Faster, smoother and more effective skills transfer,
knowledge sharing and R&D
6. Empowering new entrants from emerging markets

Asset monitoring and maintenance
Real-time remote, predictive and mobile capabilities
1
Chemical companies’ major production facilities and pipeline systems run 24/7. Unplanned shutdowns
can result in huge disruption costs.
Advanced, remote and mobile monitoring sensors can collect real-time data across the chemical plant and
combine it with other information, such as weather and geological conditions, to create a flow of Big Data
around asset health and risks.
 Using cloud-based predictive analytics, a company can identify patterns in the collected
data and issue failure warnings that help avoid unplanned outages
 Cloud-connected remote-controlled drones can be used for chemical plant
asset surveillance. Feeding surveillance information into a cloud-powered
analytics engine will enable proactive and preventive maintenance.

Value chain transformation
Integrating, sharing and analyzing Big Data along the value chain to transform visibility, speed and agility
As chemical companies expand their operations, supply networks
and customer bases across the world, their supply chains are
becoming ever more diverse, complex and distributed.
 Global integration: Cloud’s scalability, flexibility and device agnostic
connectivity enable chemicals businesses to get a globally integrated view of
their logistics in real time without massive up-front investment.
 Supplier collaboration: Sharing information with suppliers and customers on
the cloud helps supply chains operate with greater visibility, speed and
agility, enabling integrated co-development.
 Big Data utilization: Applying predictive analytics to supply chain data would
enhance businesses’ ability to predict and prevent logistical problems and
bottlenecks.
 Microsoft launched a chemical industry reference architecture (ChemRA)
that helps companies implement secure IT solutions, provide enhanced
business insights and user experience, and allow easy collaboration.4
2
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Employee health and well being
Enhanced employee health and safety, remote medical monitoring and assistance
Solutions leveraging a combination of cloud, mobility and analytics with technologies such as remote
sensors can transform occupational health and safety.
 Employee health monitoring: Mobile, cloud-connected sensors, attached to protective clothing, can provide constant
coverage and monitoring of employees’ physical condition, along with GPS tracking of their location.
The resulting data would be subject to continual cloud-based analytics to predict health threats and
initiate responses locally.
 Remote medical assistance: Cloud and mobile platforms can support remote medical assistance
in the event employees are involved in an incident. This will enable doctors across the world
to run scans and review medical sensor data to recommend treatments.
 Recruitment differentiator: Chemicals companies’ ability to protect the health and well-being
of their employees by leveraging cloud technology will become a major differentiator in
the recruitment market.
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More efficient, agile and secure IT
Using common industry platforms and utilities based on “community clouds”
Powerful analytics, massive data storage and processing capabilities are becoming vital drivers of
competitive advantage. The costs of processing and analyzing the required mass of Big Data are too
high for a single company to bear alone.
 Community cloud: By shifting enterprise resource planning (ERP) systems and internal data centers to a shared
“community cloud”, chemical companies can reduce costs by exploiting flexible, pay-per-use payment models.
• Example: Italy-based global chemicals group, Mossi & Ghisolfi has built a simplified, scalable and just-in-time cloud-based
IT model to support its business solutions running on SAP5.
 Data security: By joining the community cloud, chemical companies close many windows of access
that currently exist in their own systems, and allow cloud providers to concentrate leading-edge
security knowledge and capabilities on reducing the platforms’ “attack surface.”
 Mergers and acquisitions (M&A): The industry-wide community clouds will make M&A quicker,
easier and less costly, by enabling operations to be plugged into and unplugged from shared
cloud engines, reducing the need for complex and expensive systems integration following a merger.
4

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Robust knowledge management
Faster, smoother and more effective skills transfer, knowledge sharing and R&D
Chemical companies need to ensure that vital knowledge and insight is smoothly and effectively
transferred as older workers retire in an age where there is a rising use of mobile devices and new
technologies.
 Cloud platforms, powered by mobile and data analytics, will play a central role in enabling chemicals
companies to capture, share and transfer skills in a systematic and targeted way across the workforce.
For example, cloud-enabled two-way video links on mobile devices could:
• Allow an expert to inspect and suggest actions to correct malfunctioning equipment in real
time anywhere on the planet.
• Enable delivery of one-to-many learning through any device in any context and
location, at whatever time employees choose.
 Industry example: Specialty chemical manufacturer Clariant is using Ariba’s6
cloud-based accounts payable solution to support a smart procurement process that
reduces errors, speeds up approvals and drives compliance.
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Winning in emerging markets
Empowering a new generation of dynamic chemicals companies
Across the world, cloud solutions—especially combined with mobile—are democratizing access to
data, knowledge and applications by making these more easily accessible at lower cost to a wider
range of organizations and individuals.
 Emerging market companies: Cloud enables new players from emerging markets to grow and seize local opportunities
without relying on the expertise of the incumbent industry leaders from developed markets.
 Early adopter advantage: New-generation emerging market companies will reap the early adopter benefits of cloud
solutions, while many of their counterparts in developed markets struggle with the business case for writing off past
investments in IT infrastructure and switching to the cloud.
 Building skill bases: A new wave of chemicals companies in the emerging markets will provide incentive for western
universities to set up campuses in those countries to build up skill bases - a trend that will be fostered by universities’
rising use of cloud and mobile technologies.
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Journey to the cloud
Cloud maturity model for the chemicals industry
As chemical companies’ usage of cloud grows, they are on a journey toward using cloud’s unique attributes as
an ever greater source of competitive advantage.
Accenture’s cloud maturity model helps chemical companies map their path to cloud maturity—chemicals executives can
pinpoint their organization’s stage in the journey, assess the upcoming opportunities and plan their best next steps.
The model divides the journey to cloud maturity into three main phases starting
with commodity IT, such as email and storage, then stepping up to functional
applications, such as business intelligence (BI) and procurement, and, finally
progressing to core business applications in the cloud, such as CRM and billing.
At the same time, the company’s objectives in using cloud also mature, progressing
from a focus on costs to ad hoc strategic enablement, finally making cloud
an integral part of the strategy.

Accenture’s roadmap and maturity model for chemicals companies
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 CRM and customer insight
 Supply chain management
 Asset management
 External use of social media
 Trading
 BI and reporting
 Enterprise asset management
 Procurement, HR and finance
 Internal use of social media
 Document management for compliance
 Email
 Collaboration tools
Extent to which cloud is
a source of competitive
advantage
2
3
1
1  Storage and compute
Uncertain
and riven
with change
Data-rich,
social and
analytics
enabled
Collaborative
and suffused
with M&A
Reduce IT TCO
and capital
expenditures
Ad-hoc strategic
enabler
Integral part of
strategy development
and execution
Core business
applications
Functional
applications
Commodity IT
Extent to which cloud
computing is a source
of competitive
advantage
Scope
Value lever
2
3
Capital intensive
and cost
constrained

Realizing the opportunity: the cloud services broker
Large chemical companies are unlikely to migrate all of their data,
applications and systems to the cloud. Factors including high cost
considerations and IP concerns will ensure that cloud adoption does not
happen in one “big bang”.
This means that companies will find themselves managing a rich hybrid
blend of traditional applications and infrastructure—possibly virtualized as
private cloud—and cloud computing solutions across public, private and/or
community clouds.
To source, manage, integrate, govern and coordinate these various
internal and external cloud and non-cloud services, the IT function or an
external provider will need to act as the company’s “services broker”.

The services broker should help meet IT needs across the business by integrating and offering a wide range of
cloud services—from IaaS to PaaS, and from SaaS to BPaaS—alongside legacy in-house systems.
The role of the services broker—part process, part technology—includes:
 Selecting and negotiating the sourcing of cloud services from cloud service providers
 Aggregating, automating and integrating services
 Managing demand, workload and governance
 Creating and maintaining a service catalog that end users across the business can choose and buy from
The potential benefits of this model include the delivery of the right applications solutions to
the right users at the right time, stronger and more consistent governance
and security management, and reduced total costs of ownership.

To prepare for the journey to a hybrid, cloud-enabled environment and a services
broker model, chemicals companies first need to look holistically at their entire IT
environment and find ways to simplify it. Companies should:
 Invest in the right architecture, tools and governance to fully leverage the benefits of cloud
 Simplify IT architecture, services and the business processes they underpin—virtualize
infrastructure, drop redundant applications
 Pilot new cloud-enabled mobile and analytics platforms in specific segments or
geographies, at low risk and cost, before scaling up globally.

Takeaways
Cloud enables executive teams to change the game
Cloud computing presents major opportunities for chemicals
companies. When combined with mobile technology and
analytics, it stands to change the game in the chemicals industry.
 To succeed in this technology-driven game, chemical companies need to
commit to an ongoing journey to cloud enablement.
 Companies that invest now in planning and preparation for the cloud will be
able to establish an early lead over their competitors—or run the risk of
finding themselves struggling to catch up with their cloud-powered
competitors in the years to come.

References
1. Info.apps.gov, a service provided by GSA,About FCCI, info.apps.gov/node/2.
2. UK Cabinet Office press release, “Government adopts ‘Cloud First’ policy for public sector IT,” May 5, 2013, www.gov.uk/government/news/government-adoptscloud-
3. Gartner, “A Quick “International Invoicing at the Chemical Giant Dow Chemical,” 2012, www.authentidate.de/fileadmin/pdf/Anwender/en/
EN_AD_Success_story_Dow_Chemical.pdf.
4. Microsoft press release, “Microsoft Launches the Chemical Reference Architecture Initiative,” September 20, 2011, www.microsoft.com/en-us/news/
press/2011/sep11/09-20ChemPR.aspx./
5. SAP Business Transformation Study, Mossi & Ghisolfi, “Achieving Agile, Scalable, Cost-Effective, and Consumption-Based IT Using the Cloud,”
www.google.co.uk/search?client=safari&rls=en&q=Mossi+%26+Ghisolfi+cloud+SAP&ie=UTF-8&oe=UTF-&gws_rd=cr&redir_esc=&ei=uyj2UeqFK4imhAfMwIA4.
6. Clariant/Ariba press release, “Clariant Transforms Invoicing with Ariba,” November 15, 2011, www.businesswire.com/news/
home/20111115005183/en/Clariant-Transforms-Invoicing-Ariba.
Go Back
first-policy-for-public-sector-it.

Appendix
21
• Accenture at a glance
• Accenture cloud services
• Accenture technology vision

Accenture at a glance
22
Summary Investments
• More than 293,000 people serving clients in more than 120 countries
(Aug. 31, 2013)
• We deliver services and solutions through 17 focused industry groups
in five operating groups.
• A network of more than 50 delivery centers around the world with
over 122,000 resources
• NYSE (ACN), Revenue US $28.6 billion for fiscal year ended
Aug 31, 2013
• Accenture was added to the S&P 100 in March 2012
• Ranked No. 1 in the International Association of Outsourcing
Professionals' (IAOP) list of the world's top outsourcing service
providers for the fifth year in a row.
• $800+ million in training annually
• $500+ million on R&D
Enduring relationships
• 99 of our top 100 clients have been clients for 5 years;
92 have been clients for at least 10 years
• Clients include 92 of the Fortune Global 100 and three-quarters of
the Fortune Global 500

Thought Leadership
23
A New Era for the
Chemicals
Industry: Cloud
Computing
Changes the Game
The Digital
Chemical Company
Navigating the Digital
Divide in Chemicals
Getting Serious
About Analytics:
Better Insights, Better
Outcomes
Digital Enterprise
Services for
Chemicals

Services and thought Leadership
Accenture cloud
24
Using an IT resource no longer depends on having the capital to
own that resource, thanks to cloud computing.
As competitive dynamics shift, Accenture can help your
organization to map its path to the cloud.
www.accenture.com/cloud

From Digitally Disrupted to Digital Disrupter
Accenture Technology Vision 2014
Digital-
Physical
Blur
Data Supply
Chain
Architecting
Resilience
From Workforce
to Crowdsource
Harnessing
Hyperscale
Business of
Applications
• Video
• Exec Summary
• Trends Summaries
• Full report
Cloud computing can
enable this digital
transformation
www.accenture.com/technologyvision

Contacts
26
For more information on how Accenture can help you with cloud in the chemicals industry, please contact:
Amanda Shoemaker
Cloud Sales Enablement, Resources – NA
amanda.n.shoemaker@accenture.com
Clive Broad
Cloud Sales Enablement, Resources – EALA
clive.broad@accenture.com
Gaurav Sharma
Cloud Sales Enablement, Resources – APAC
gaurav.k.sharma@accenture.com

A new era for the chemicals industry: Cloud computing changes the game

A new era for the chemicals industry: Cloud computing changes the game

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